New ATM restrictions from May 1, transaction charges will increase after the free limit

The Reserve Bank of India (RBI) has amended the framework for ATM charges, which will take effect on Thursday (May 1). The modifications will have an impact on the country's financial system, including free transaction limits, increased transaction costs, and interchange fees. Customers can now use the ATM for a limited amount of transactions each month before incurring a fee. There will be three free transactions in metro areas and five in non-metro areas, encompassing both financial and non-financial activities.

Once a consumer reaches the transaction limit, they may be charged ₹23 for each additional transaction made using ATMs and Cash Recycler Machines (CRMs). However, the costs will not apply to cash deposits made through CRMs. When a consumer uses their own bank's ATM, only financial transactions are counted; however, financial and non-financial transactions are counted for other banks. The RBI's decision stems from the necessity to ensure the financial stability of the country's ATM operations.

India had 2,16,706 ATMs in January 2025, with 1,30,902 on-site and 85,804 off-site ones. Several variables have influenced ATM operations, including increased operational costs for maintenance, cash handling, and technology updates. These issues necessitated an adjustment to the charge structure to ensure continuing ATM availability, which benefited smaller banks and white-label providers.